The Australian Taxation Office (ATO) has increased its scrutiny of the misuse of offshore tax structures and tax havens by Australian residents, according to tax commissioner Michael D’Ascenzo.
He warned residents yesterday against “hiding income or assets in offshore structures or tax havens”, claiming there will be “no place to hide undisclosed income” under the new initiative.
“People who use offshore structures to deliberately hide assets or income in tax havens can face serious penalties, including criminal prosecution,” he said.
His warning follows an ATO announcement last month that it is investigating tax evasion and avoidance by Australian residents via legal structures in Liechtenstein.
Taxpayers needed to be “cautious when considering whether to use offshore structures or tax havens, including Liechtenstein, for abusive purposes”, D’Ascenzo reiterated yesterday.
“Australian residents have tax obligations for their worldwide income, including Australian and overseas sources, such as profits from tax haven entities and bank accounts.”
However, D’Ascenzo said residents who “contact the ATO before they are the subject of an audit may be entitled to substantial reductions in shortfall penalties under our offshore voluntary disclosure initiative”.
